Ministry of Interior in Serbia initiated a toner procurement that can damage the budget for almost million euros. 

By Vladimir Erceg (BCSP) / Photo: Market-Inspector
@elercad

The Serbian Ministry of Interior (MoI) initiated a procurement of 9390 toners at the beginning of April. The realization of this tender could damage the budget of MoI for 115 million dinars or one million Euros.

There are two problems.

This tender is not in accordance with the law. The documentation contains unlawful terms that seriously limit the participation. A bid is limited only for original equipment manufacturer (OEM) toners, without the option of an appropriate alternative, which is obligatory to Article 71 of the Public Procurement Law.

This tender is not expedient. The price of the OEM toners is 2 to 10 times higher than certificated compatible.[1] MoI insists on the procurement of original toners for printers because the Ministry is convinced that the utilization of other than OEM toners would void the warranty of the printers. According to legal warranty terms of all printer manufacturers, this is not the case.[2]

According to the available data the quality of original and certified compatible toners is almost or completely the same, they are produced according to industry standards and with their own warranty. A practice of using certified compatible toners didn’t show that these toners cause significantly more damage to the printers than the original ones. Authorized printer servicers declared that the warranty of a device can be lost only if it is proven that the damage on the printer is caused by faulty and non-OEM toner.

In answer to the interested bidder, the Ministry disclosed that they signed a 52 million dinars value contract in 2016 for the procurement of new laser printers, a contract that defines that the warranty is lost by using any kind of non-OEM toner. If this is true, then the MoI signed a harmful contract with the supplier of these printers, with fewer consumer rights than other customers, and in contrast to the common warranty terms of printer manufacturers. MoI should seek to change the warranty terms of this contract and avoid contracts with similar conditioning in the future.

If the MoI procures only OEM toners it will pay 135 million dinars for 9390 pieces, while for the same amount of high-quality certificated compatible toners, available on our market, it would pay around 20 million RSD. The bad economy of this procurement is evident, especially having in mind that the MoI in 2016 procured 1000 printers for 52 million RSD and now is ready to spend twice as much than it has to just to have the OEM toners for these printers. It is not realistic to expect that the usage of certified compatible toners will damage all 1000 of newly procured printers. Even if the MoI would lose the warranty, it would save well enough money to service damaged printers or even buy 2000 new ones.

Toner procurement is initiated at the moment when every dinar at the MoI disposal is important, especially considering the bad material condition of police officers and quality and quantity of their equipment. The savings of one million Euros on OEM toners could be used for solving some of these or other urgent problems.

[1] According to the market prices of asked products on April 9, 2017.

[2] Sources: HP: https://goo.gl/XdwEV5, p 12.; Kyocera: https://goo.gl/HN7qpx; Lexmark: https://goo.gl/hn8iDL

TAGS: AnalysisBudgetFinancial ManagementProcurementSerbia